Skip to main content

Mumbai Is India's Most Expensive City To Live In. Second Place Is...

Mumbai Is India's Most Expensive City To Live In. Not Delhi, In Second Place Is...

The most expensive housing market is Mumbai.

New Delhi:

Ahmedabad is the most affordable Indian city to live in according to a new report released by Knight Frank India- a leading property consultant.

The affordability index released by Knight Frank measures living affordability based on the EMIs a resident in that city has to pay if they get a house with a home loan divided by the total income of an average household in that city.

The Knight Frank Affordability Index indicates the proportion of income that a household requires, to fund the monthly installment (EMI) of a housing unit in a particular city. So, a Knight Frank Affordability index level of 40% for a city implies that on an average, households in that city need to spend 40% of their income to fund the EMI of housing loan for that unit.

An EMI/Income ratio over 50% is considered unaffordable as it is the limit beyond which banks rarely underwrite a mortgage.

The most expensive housing market is Mumbai.

For Mumbai, the home loan EMI to income ratio is a whopping 55%, meaning that an average household has to pay more than half of its income on home loan EMIs if they have to get a house on loan.

Next, Hyderabad is the 2nd most expensive city with an EMI to income ratio of 31%.

At the third spot, it's the Delhi National Capital region where you have to shell out 30% of your income for home loan EMIs.

Tamil Nadu's Chennai is at the next spot with an EMI to income ratio of 28%.

Next, at the 5th spot, it's Pune in Maharashtra where an average household has to pay 26% of their income on home loan EMIs.

The rate is the same for Kolkata in West Bengal. And in the end, the most affordable Indian city to live in is Ahmedabad in Gujarat where an average household needs to pay 23% of its income for home loan EMIs. This index has assumed a loan term of 20 years, a loan to value ratio of 80%and a fixed house size across cities.

Over the last 1 year, living in these cities has only become more expensive. These EMI to income ratios across cities have gone up around 1-2 percentage points, because the Reserve Bank of India has hiked its key lending rate by 250 basis points since last year. This increased the EMI load across cities by an average of 14.4% since then.

The worst impacted category has been houses that cost less than 50 lakh rupees. Sales in this category have gone down, according to the report. That's because the report says Homebuyers in this segment have a much higher dependence on home loans and are therefore more sensitive to rate hikes compared to the mid and premium segment, so they can no longer afford home loans with higher EMIs, so many of them are not able to afford buying houses.

But on the other side, the demand for the mid and premium segment has been consistently outperforming. The sales for houses costing 50 lakh to 1 crore in these has gone up to around 59,000 units this year, while the sale for premium houses costing over 1 crore has gone up to 47,000 this year.

And overall, the residential demand is at a multi-year high, according to the report, while clearly, the lower and middle income groups are suffering.

Shishir Baijal, Chairman and Managing Director, Knight Frank India said, "The RBI's extremely capable handling of the inflationary scenario has inspired confidence in the country's economic environment. This is also reflected in the residential demand which is at a multi-year high and office demand which has remained resilient even as office markets globally have been struggling.

The mid and premium segments in the residential market have been consistently outperforming and points to a significant shift in the market's underlying fabric. However, the 250 bps increase in policy rates has reduced affordability across markets by 2.5% on an average. And, while the market has remained strong thus far, further interest rate increases could put pressure on homebuyer ability and sentiments."

Adblock test (Why?)



from NDTV News- Special https://ift.tt/Qb8BEU2 https://ift.tt/LeBzj3r
via IFTTT

Comments

Popular posts from this blog

North Korea Says It Tested New Strategic Cruise Missile

North Korea test-fired a new generation of strategic cruise missile on Wednesday. (Representational) Seoul: North Korea fired several cruise missiles towards the Yellow Sea on Wednesday, Seoul's military said, the latest in a series of tension-raising moves by the nuclear-armed state. Hours later, North Korea appeared to confirm the firing, saying it had carried out its first test of a new generation of strategic cruise missiles it is developing, the Pulhwasal-3-31. Pyongyang has accelerated weapons testing in the new year, including tests of what it called an "underwater nuclear weapon system" and a solid-fuelled hypersonic ballistic missile. "Our military detected several cruise missiles launched by North Korea towards the Yellow Sea at around 7:00 am today," the South Korean Joint Chiefs of Staff said in a statement. Unlike their ballistic counterparts, the testing of cruise missiles is not banned under current UN sanctions against Pyongyang. Cruise...

18-Year-Old Killed By Friends Over Mobile Game Password In Bengal: Cops

According to cops, accused "friends" attempted to burn the victim after killing him. (Representational) Kolkata: An argument over sharing the password of an online mobile game allegedly led to the murder of a teenage boy by four of his friends in West Bengal's Murshidabad district, a senior police officer said. The body of 18-year-old Papai Das, who had been missing since January 8, was discovered near Nishindra Ghat of the feeder canal in Farakka on Monday, police said. Papai, a class 10 student, was reportedly killed by his four "close" friends after a disagreement over sharing the password for a mobile online game. The accused individuals have been arrested, police added. "These five individuals used to play online games at one of the quarters of the Farakka Barrage. The victim went out on the evening of January 8 and never returned. On January 9, the family lodged a police complaint. "Based on preliminary investigations, we discovered that...

"Jaiswal Has Run Ahead Of Gill": Ex-India Star's Massive T20 WC Verdict

Former India opener Aakash Chopra has suggested that Yashasvi Jaiswal is slightly ahead of Shubman Gill in the pecking order as captain Rohit Sharma's partner at the top in T20Is. Since making his debut last year, Jaiswal has been in stunning form in the shortest format of the game. Gill's form, on the other hand, has dipped since the ODI World Cup last year in India. With the T20 World Cup scheduled to be held later this year, Chopra feels Jaiswal will open the innings with Rohit during the tournament. "It's clear that Yashasvi Jaiswal has run ahead of Shubman Gill. Yashasvi is ahead in the two-horse race, Gill is lagging slightly behind. Gill was played in the first match, dropped in the second, and wasn't played in the third as well," Chopra said on his YouTube channel. Jaiswal helped India beat Afghanistan in the second T20I earlier this week, scoring a quickfire fifty. Considering his recent form across formats, Chopra emphasised that Jaiswal has ...